Form new DBA or LLC with judgment

UPDATED: Oct 1, 2022

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Form new DBA or LLC with judgment

I want to form a new LLC or just as DBA license. I have a judgment on file with a court, personal judgment only. Will this affect my new company? I won’t be moving any assets or money from personal stuff to the new company, it will all be new income from the new company. Can the plaintiff that has the judgment do anything to my new company? It would be done in another state.

Asked on October 16, 2017 under Business Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

If you just register as a d/b/a, then you and the business are legally the same person and business income or assets could be subject to your personal debt.
If you create an LLC, the LLC will be exempt or protected from your personal debts, the same way that you are personally protected from LLC debts or obligations, so long as you respect the LLC formalities and form: do not comingle your money or assets with LLC money or assets, do not have the LLC pay pursely expenses or debts for you, etc. Keep the LLC and you separate.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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